Performance creates trust

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Performance creates trust

Financial Products going digital

a new & better client offering

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Financial Products

R et u rn Equities/FX Bonds

World of structured products

Participation Yield enhancement Capital Protection Warrants

What are they

Combining a bond and an underlying (shares, FX etc)

Wrap into a fungible security

Issuer risk like any bond

Why buy them

Highly flexible investment product

Risk / return calibrated to client need

How to use

In client portfolio context

Short tenors, yield generation

Theme based investment

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Financial Products – significant market

Switzerland

Client Assets1_{: CHFb 5’565}

Outstandings1_{: CHFb} ₁₉₇

Turnover2_: _CHFb ₃₅

Singapore & Hong Kong

AUM: CHFb n.a. Outstandings2_{: CHFb} ₂₅₅

Turnover2_: _CHFb ₂₅₁

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Digital Ecosystem – bringing it all together

Client Relationship Manager Technology, Platform Trading Know-how: Market

infrastructure, regulation and participants

Provides: Various execution services

Investment

Research Know-how: Macro and

micro valuation, market modelling, etc. Provides: Fundamental

research, forecasts, SAA, TAA

Know-how: KYC, client profile, history, status, etc. Provides: Serves client with

bank know-how and services to achieve client goals

Advisory

Know-how: Technical market and product know-how, local focus

Provides: Security, product and portfolio-design

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High entry barriers – natural network effects – significant cost reductions for all participants

Disruptive, high volume business model

Standard business model Leveraging revenue growth

Vontobel issuer Distributors Vontobel deritrade® MIP External issuers Distributors

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Value Driver – cost and scalability

Key Process steps RM SP desks Operations

Pre Trade Trade & Execution Product Life Cycle Trade Reporting & MIS Redemption & Repayments Product Delivers & Client Booking Decision support Price discovery

Pre Trade docs

RFQ

Execution

Confirmation & Docs

Static data delivery

Static data opening

Client booking support

Product retrieval

Daily Valuation

Corp Action support

RM notifications

Online trade reporting

User agnostic reporting and MIS Pre notice to RM Final Notice to RM and Ops deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade deritrade Lower cost From CHF 3’500 down to CHF 10

Lower investment amount From 3 – 5 mio down to 20’000

Better client offering More yield for same risk

Tailor-made product

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Value Driver – client experience

Empower client advisors

Bring the offering to point of sale

Provide decision support tools

Involve clients

To create the product

To define product risk / return

To better understand the investment

Better client offering

Increased accessibility

Increased buying convenience

More return for the risk

Issuer 1

Issuer 2

Issuer 3

Issuer 4

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Digitalization - more efficient distribution

deritrade® MIP digitalization to bring offering to point of sale Client advisors creating product directly for client

deritrade® MIP Issuer End-clients tailored structured product End-clients standard structured products Client advisors Standard New Distributors Product Specialists

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0 5 10 15 20 25 30 20 40 60 80 100 120 140 160 180 200 2 0 1 3 1 1 2 0 1 3 1 2 2 0 1 4 0 1 2 0 1 4 0 2 2 0 1 4 0 3 2 0 1 4 0 4 2 0 1 4 0 5 2 0 1 4 0 6 2 0 1 4 0 7 2 0 1 4 0 8 2 0 1 4 0 9 2 0 1 4 1 0 2 0 1 4 1 1 2 0 1 4 1 2 2 0 1 5 0 1 2 0 1 5 0 2 2 0 1 5 0 3

Notional CHFm (left axis) # distributors (right axis)

1. Deutsche Bank 2. Morgan Stanley 3. Société Générale 4. UBS 5. Vontobel 6. ZKB 7. Undisclosed name Cooperations Raiffeisen

UBS Wealth Management (go live Q2/2015) Issuers Distributors Vontobel PB Centrum Vadian Berenberg Undisclosed name Regio Männedorf Volksbank Regio Solothurn Bank Zimmerberg

External Asset Managers

>300 External Asset Managers

Summary:

Number of banks: 25

of which cooperations 2

External Asset Managers: >300

Market potential:

Addressable AuM1_: _{>CHF 1,000 bn}

Annual issues1_: _{CHF 35 bn}

Annual secondary volume1_{: CHF 20 bn}

1_{Vontobel estimates} 25 Banks Onboarding issuers Finishing offering Platform development Starting distribution d er iv at iv e. co m Zuger KB LGT Hypo Lenzburg Rothschild Bank Schwyzer KB Bank in Zuzwil Bank Thalwil Bankhaus Jungholz B. Cant. Neuchateloise Bonhote

Lienhardt & Partner

EEK

Acrevis Bank AG

Landolt & Cie

Walliser KB

Banque Cramer

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APAC – Swiss technology export…..

Key value proposition Strategy & status

Structured products are a buyers market, MIP is addressing the overriding need for lower costs on the distribution side

Leveraging of Swiss platform, adjusted for APAC-specific needs. Technology already operational

Building the offering (issuers & APAC products)

- Vontobel issuer live

- Issuer 2 (undisclosed name), signed MoU1_{, work underway}

- Issuer 3 (undisclosed name), signed MoU1_{, work underway}

- Ongoing discussions with 5 more issuers

Building the distribution franchise

- Distributor 1 (undisclosed name), signed LoI2

- Ongoing discussions with 8 more distributors

Price discovery is already automated in APAC, MIP will reduce existing costs and complexity

Technology and knowhow-driven handling of trades will reduce current high cost for distributors

MIP will bring the product offering to the point of sale via a purpose-built user interface, further reducing costs

MIP will introduce a new level of front to back automation, resulting in a paradigm shift

Product lifecycle Transaction Comprehensive decision support Pre-trade pricing simulations

Real-time price offers from issuers

Price competition

Full automated trade execution

Online product data and reporting

Automated corporate actions

Expiration and

repayment notifications Paradigm shift area

1_{Memorandum of Understanding} 2_{Letter of Intent} Expiration and redemption Price discovery Pre-trade decision support

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Seeing is believing………….

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Seeing is believing………….

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Curriculum Vitae

Gerhard Meier, Managing Director

Global Head deritrade® Multi Issuer Platform, Bank Vontobel AG

Gerhard Meier joined Bank Vontobel in November 2013 assuming overall responsibility for deritrade® Multi Issuer Platform globally, the leading platform for Structured Products. Previously he worked 14 years for UBS, both on the Wealth Management and Investment Bank side, building the UBS Structured Products Platform “Equity Investor” from scratch. Before joining UBS, Gerhard Meier played a key role in setting up and developing EBS to the leading global FX trading platform. In addition, he has profound knowledge of the Reinsurance market, Credit Risk systems and Consumer eCommerce solutions.

Gerhard Meier holds a diploma in business administration, and attended various educational and training programs in sales, reinsurance, banking, market and credit risks in Switzerland, UK, USA and Asia

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Disclaimer

This document was produced by Bank Vontobel AG (hereafter “Vontobel”) with the

greatest of care and to the best of its knowledge and belief. However, Vontobel provides no guarantee with regard to its content and completeness and does not accept any

liability for losses which might arise from making use of this information. The opinions expressed in this document are those of Vontobel at the time of writing and are subject to change at any time without notice. If nothing is indicated to the contrary, all figures and data are unaudited. This document is provided for information purposes only. It does not constitute an offer or a recommendation to buy or sell financial instruments or

banking services. This document may not be reproduced either in part or in full without the written permission of Vontobel. It is expressly not intended for persons

who, due to their nationality or place of residence, are not permitted access to such